Frequently Asked Questions

Education Protection Account

General Information

1. What is the Education Protection Account (EPA)? (Updated 26-Jan-2018)

   The Education Protection Account (EPA) was created in November 2012 by Proposition 30, The Schools and Local Public Safety Protection Act of 2012, and it was implemented in 2013. The EPA is governed by Section 36 of Article XIII of the California Constitution, which was amended by Proposition 55 in November 2016.
   
   The revenues generated from Section 36 of Article XIII of the California Constitution are deposited into a state account called the Education Protection Account. Of the funds in the account, 89 percent is provided to K-12 education and 11 percent to community colleges.
   
   More information on Propositions 30 and 55 .
   
   Source: Article XIII, Section 36, Subdivision (e), Paragraph (3) of the California Constitution .

2. Are EPA funds appropriated through the annual Budget Act?

   No, the funds are continuously appropriated and are not contingent on the passage of the State budget by the constitutional deadline.
   
   Source: Article XIII, Section 36, Subdivision (e), Paragraph (3) and Paragraph (4) of the California Constitution .

3. What entities will receive a share of the K–12 EPA funds?

   Local educational agencies (LEAs), including school districts, county offices of education (COE) and charter schools will receive funds from the EPA.
   
   Source: Article XIII, Section 36, Subdivision (e), Paragraph (3), Subparagraph (B) of the California Constitution .
   

4. How much money has been allocated to EPA? (Updated 19-Jun-2024)

   
   Education Protection Account Revenue Allocation
   

   Fiscal Year	EPA Revenue	EPA Proportionate Share
   2012–13	$6,509,460,000	21.38904%
   2013–14	$6,284,237,490	21.03167%
   2014–15	$7,753,846,430	26.66369%
   2015–16	$7,201,896,910	25.71750%
   2016–17	$6,708,585,040	24.75705%
   2017–18	$6,809,114,100	25.89051%
   2018–19	$7,697,384,830	30.50771%
   2019–20	$4,227,494,660	16.08698%
   2020–21	$12,658,753,910	70.06785%
   2021–22	$15,816,436,575	73.31789%
   2022–23	$4,070,843,090	12.74781%
   2023–24	$7,015,754,300	21.98881%

   This chart will be updated each fiscal year after the Second Principal (P-2) Apportionment certification. For current fiscal year EPA information, see the CDE Funding Rates and Information web page.

5. Does an LEA need to submit an application to the state to receive EPA funds?

   No, EPA funds provide general purpose funding to LEAs and will flow automatically from the state.

6. Will the EPA proportionate share percentage for a fiscal year change over the course of the year? (Updated 05-Aug-2022)

   Yes, for each fiscal year cycle the EPA proportionate share percentage will be recalculated four times.
   
   Before the start of each fiscal year (June 30), the California Department of Finance (DOF) will provide an EPA revenue estimate. In the fourth quarter of each fiscal year, the DOF will provide an updated EPA revenue amount based on statewide receipts for the current fiscal year.
   
   The chart below illustrates the data elements and timing of each calculation of the EPA proportionate share percentage.

   Education Protection Account Proportionate Share Percentage Calculations

   DOF's EPA Revenue Amount	Calculation	Statewide Revenue Limit and Charter School General Purpose Entitlement Total as of...	Calculation	EPA Proportionate Share Percentage for...
   Pre-Fiscal Year Estimate (June 30)	Divided by	Advance	Equals	1st Quarter (September) and 2nd Quarter (December)
   Pre-Fiscal Year Estimate (June 30)	Divided by	P-1	Equals	3rd Quarter (March)
   Final Amount (4th Quarter)	Divided by	P-2	Equals	4th Quarter (June)
   Final Amount (4th Quarter)	Divided by	Annual	Equals	Prior Year Adjustment

   The EPA proportionate share ratios can be found on the CDE's Funding Rates and Information web page.

7. When will EPA entitlements be allocated? (Updated 06-Jun-2017)

   EPA funds are allocated on a quarterly basis in September, December, March and June of each year.

8. The EPA amount received is a reduction to Local Control Funding Formula state aid. When will the state apply these reductions?
   

   Except for "excess tax" LEAs, every dollar an LEA receives in EPA funding is a reduction to their Local Control Funding Formula (LCFF) state aid funding allocated through the Principal Apportionment. The reductions will be applied at each Principal Apportionment certification.
   

Entitlement Calculations and Payments

9. What data (revenue limit, local revenue, and Average Daily Attendance) is used to calculate EPA funding under LCFF? (Updated 05-Aug-2022)

   The EPA entitlement calculation requires three data elements that are specific to each LEA:

   • Current year funded Average Daily Attendance (ADA)
   • Current year local revenue or in-lieu of property taxes
   • 2012–13 adjusted revenue limit or charter school general purpose funding, which beginning in the 2021–22 fiscal year, are adjusted annually for school districts and charter schools by the statutory cost of living adjustment (COLA). COLA information can be found on the CDE's Funding Rates and Information web page.
     

   
   The ADA and local revenue/in-lieu of property tax data used for EPA is the same data used for other Principal Apportionment programs. The tables below provide the Principal Apportionment exhibit name and location that are the sources of these two data elements.

   For School Districts

   EPA Exhibit Field Description	Principal Apportionment Exhibit Data Source
   Total ADA for EPA Minimum (Line A-1)	School District LCFF Calculation, Line B-10 Basic Aid Choice Calculation, Line E-5 Basic Aid Court Ordered Voluntary Pupil Transfer Calculation, Line E-5
   School District Current Year Funded ADA, excluding Necessary Small Schools (NSS) (Line B-5)	School District LCFF Calculation, Line B-5
   School District Current Year Funded ADA, including NSS (Line B-5)	School District LCFF Calculation, Line B-10
   Local Revenue/In-lieu of Property Taxes (Line B-13)	School District LCFF Calculation, Line I-1

   For County Offices of Education

   EPA Exhibit Field Description	Principal Apportionment Exhibit Data Source
   Total ADA for EPA Minimum (Line A-1)	County LCFF Calculation, Line A-4 County LCFF Calculation, Line A-7
   Local Revenue/In-lieu of Property Taxes (Line B-13)	County LCFF Calculation, Line D-2

   For Charter Schools

   EPA Exhibit Field Description	Principal Apportionment Exhibit Data Source
   Total ADA for EPA Minimum (Line A-1)	Charter School LCFF Calculation, Line B-5
   Local Revenue/In-lieu of Property Taxes (Line B-13)	Charter School LCFF Calculation, Line I-4

10. How is EPA funding calculated? (Updated 05-Aug-2022)

    Despite implementation of the Local Control Funding Formula (LCFF) in fiscal year 2013–14, EPA entitlements continue to be calculated based on adjusted revenue limits, including the allowance for necessary small schools, and charter school block grant funding in accordance with Section 36 of Article XIII of the California Constitution. The CDE will allocate EPA revenues on a quarterly basis through the 2030–31 fiscal year. Charter schools newly operational in the 2013–14 fiscal year and after receive the EPA minimum funding level of $200 per unit of ADA.
    
    The CDE calculates EPA entitlements based on the statewide total of revenue limits and charter school block grant funding as calculated for the purpose of EPA. Each LEA's EPA entitlement is then reduced so that funding from local revenue and the EPA combined do not exceed the LEA's adjusted revenue limit or charter school general purpose funding, provided that each LEA receives the minimum EPA funding of $200 per unit of ADA. For most LEA's, EPA funding offsets LCFF state aid allocated through the Principal Apportionment.
    
    Below are three simplified examples of the EPA entitlement calculation. Example 1 shows an LEA whose EPA entitlement is the proportionate share amount. Example 2 shows an LEA whose EPA entitlement is reduced so that the in-lieu funding plus EPA entitlement does not exceed its revenue limit. Example 3 illustrates a scenario where an LEA would receive the $200 per ADA minimum.
    

    Education Protection Account Calculation Example

    Step	EPA Entitlement Calculation	Example 1	Example 2	Example 3
    A-1	Current ADA	20,000	20,000	20,000
    A-2	Per ADA Minimum	$200	$200	$200
    A-3	Minimum per ADA (A-1 x A-2)	$4,000,000	$4,000,000	$4,000,000
    B-1	Adjusted Revenue Limit/General Purpose Block Grant	$100,000,000`	$100,000,000	$100,000,000
    B-2	Local Revenue/In-Lieu	$65,000,000	$85,000,000	$97,000,000
    B-3	EPA Entitlement Cap (B-1 - B-2)	$35,000,000	$15,000,000	$3,000,000
    C-1	Adjusted Revenue Limit/General Purpose Block Grant (B-1)	$100,000,000	$100,000,000	$100,000,000
    C-2	Proportionate Share Ratio	25.00%	25.00%	25.00%
    C-3	EPA Proportionate Share (C-1 x C-2)	$25,000,000	$25,000,000	$25,000,000
    D-1	EPA Entitlement (Lesser of B-3 or C-3, but not less than A-3)	$25,000,000	$15,000,000	$4,000,000

    
    Source: Article XIII, Section 36, Subdivision (e), Paragraph (3), Subparagraph (B) of the California Constitution .
    
    

11. Revenue limit or charter school general purpose funding changes at each Principal Apportionment certification as a result of ADA and other adjustments. Does this mean the EPA entitlement will change also? (Updated 05-Aug-2022)

    Yes. An LEA’s EPA entitlement will be determined at the Advance, P-1, P-2, and Annual Apportionment certification periods. An LEA’s EPA entitlement will not change after the Annual certification even if the LEA’s ADA or revenue limit amount changes at the Annual R1, R2, or R3 certifications. CDE will compare the final EPA entitlement at Annual to the EPA entitlement calculated as of P-2 and any adjustment (positive or negative) will be applied against an LEA’s current year EPA apportionment.

12. Is the $200 per ADA EPA minimum funding in addition to $120 ADA constitutional guarantee?

    Yes, each are separate constitutional guarantees.

13. Are funds received from EPA used in the determination of an LEA's "basic aid" or excess tax" status? (Updated 06-Jun-2017)

    No, the determination of whether a school district is "basic aid" or "excess tax" is made prior to the consideration of EPA revenue pursuant to EC Section 42238.02(m) .

14. Why can an LEA receive only $200 per-ADA minimum when it is not considered "basic aid" or "excess tax" under LCFF? (Updated 05-Aug-2022)

    An LEA's "basic aid" status under LCFF is not a component of the EPA entitlement calculation, because the law governing EPA uses an LEA's revenue limit or charter school general purpose funding. See Question 10 for more information about the continued use of revenue limits and charter school general purpose funding data in the EPA calculation. An LEA will receive the $200 per-ADA minimum if:

    • The LEA is a charter school newly operational as of 2013–14 or later,
      
      
    • The local revenue/in-lieu exceeds the adjusted revenue limit/charter school general purpose funding, or
      
      
    • The difference between the LEA's revenue limit/charter school general purpose funding and its local revenue/in-lieu is less than the per-ADA minimum funding threshold.

15. Where can I find information on EPA entitlements and apportionments?

    EPA Entitlement and Apportionment information is available on CDE's website.

16. Is there a schedule of the specific dates when EPA payments for the fiscal year will be made? (Updated 06-Jun-2017)

    The State Controller's Office publishes annually a report of its estimated payment schedule, which includes EPA, on its State and Local Apportionments web page .

Use of Funds and Reporting Requirements

17. Must the EPA entitlement be allocated proportionately to the programs whose ADA generates the LEA's revenue limit funding? (Updated 06-Jun-2017)

    There are no statutory requirements on how EPA funds should be allocated and each LEA decides locally how to best allocate funds.

18. Are there reporting requirements? (Updated 06-Jun-2017)

    Article XIII, Section 36, Subdivision (e), Paragraph (6) of the California Constitution requires all districts, counties and charter schools to report on their websites an accounting of how much money was received from the EPA and how that money was spent.

19. Will the CDE provide a template that LEAs can use for reporting EPA revenues and expenditures? (Updated 06-Jun-2017)

    The law does not prescribe a format for LEAs to report their receipt and expenditure of EPA funds, nor did it require the CDE to develop a format. Therefore, the CDE will not be providing a template. It will be at each LEA’s discretion to determine the format for reporting its EPA revenue and expenditures on its website.

20. The law requires that the use of EPA funds be determined by the governing board at an open public meeting. Does this meeting need to be a separate meeting only for the discussion of EPA funding? (Updated 06-Jun-2017)

    The law does not specify that the open public meeting has to be a separately held meeting. Therefore, this requirement may be satisfied at a regularly scheduled meeting, which the CDE believes could be the annual budget adoption meeting.

21. When should the open public meeting for discussing the use of EPA funding be held? (Updated 06-Jun-2017)

    The law does not specify that the open public meeting has to be a separately held meeting. Therefore, this requirement may be satisfied at a regularly scheduled meeting, which the CDE believes could be the annual budget adoption meeting, although it could be at any open public meeting before expenditures are recorded for each applicable fiscal year.

22. Are there any restrictions on the use of EPA funds?

    Yes, specific information on the use of funds is available on CDE’s website.

23. Has the CDE issued accounting guidance on how to account for EPA funds?

    Yes, accounting guidance is available on CDE’s website.